Restructuring pays off for Spice

The Leeds-based group, which provides services ranging from refurbishment of overhead power lines to pinpointing unbilled properties, also said Martin Towers, the interim chief executive, had been confirmed in the job permanently.

Profit for the year to April 30 before tax, amortisation and exceptional items will be slightly better than the 32.3m achieved in 2009.

In a trading statement it said: "The group's conversion of profits into cash has remained strong in the second half of the year, culminating in net debt of approximately 118.5m at 30 April 2010."

Spice said it had carried out a review of its cost base and the cost of the restructuring which followed was between 8m and 9m, of which about 6m would be a cash cost during the year ending April 2011.

It also said the supply division is trading in line with expectations with energy recording a number of new customer additions in the year.

"The Carbon Reduction Efficiency Scheme has accounted for around 20 per cent of these customer wins and is likely to remain a significant driver of new opportunities.

"Approximately two per cent of group revenues are derived from the public sector, principally within Energy, and in recent months, there has unsurprisingly been some deferral of project spend for public sector energy projects. Accordingly, the Group has sought to redeploy engineers to the private sector.

The distribution business, which works with the utility industry, is also trading in line with expectations.

Contracts with Scottish Power, AT&T and Yorkshire Water have all recently been extended, it said, and new contracts have also been secured with Cambridge Water and "significant" windfarm projects.

Spice remains in discussions with EDF Energy about extending its contracts.